Signifying the evolving complexities of family law, a contractual dispute connected to a divorce matter was recently ventilated before our Constitutional Court. In D H B v C S B, the Court was tasked with assessing the enforceability of a prenuptial agreement and the extent to which the parties to a marriage may contract out of the spousal maintenance provisions of the Divorce Act. The judgment provides an important contribution to the development of the law in this domain.
The facts
In early 2015, D H B (‘the Applicant’) and C S B (‘the Respondent’) concluded an antenuptial contract (‘the ANC’), which expressly excluded the accrual system, before the solemnisation of their marriage. A month after the ANC was registered, the parties entered into a prenuptial agreement intended to be read with the provisions of the ANC. Under the prenuptial contract, the Applicant agreed to donate the following to the Respondent upon the dissolution of their marriage: Immovable property valued at R1.5 million, a vehicle to the value of R250 000.00, monthly contributions toward the Respondent’s medical aid, payment of the Respondent’s life insurance premiums for the duration of her lifetime, and R20 000.00 per month in spousal maintenance.
In 2018, the Applicant filed for divorce in the Regional Court, which proceedings are still pending. The Respondent subsequently instituted a counterclaim in which she sought to enforce the terms of the prenuptial agreement. While the Applicant conceded to executing the prenuptial agreement, he alleged that it was unenforceable and instead contended that the parties abandoned it when their ANC was registered. Accordingly, the parties requested the Regional Court separately determine the enforceability of the prenuptial agreement.
The central question for determination
At the heart of the matter is whether a prenuptial agreement is enforceable in light of the existence of a valid ANC. Specifically, the Constitutional Court was tasked with adjudicating whether the parties’ prenuptial agreement, which aims to regulate the patrimonial consequences of divorce, is contrary to prevailing public policy and unenforceable for excluding the jurisdiction of the courts under section 7(2) of the Divorce Act (‘the Act’). In instances where there is no written agreement regulating maintenance, section 7(2) of the Act empowers a court hearing a divorce matter to award spousal maintenance having regard to various factors, including the parties’ respective means, their financial needs and responsibilities, and their standard of living during the marriage.
What did the Regional Court find?
In the Regional Court, the Respondent argued that the provisions of the ANC and prenuptial agreement could be read together. The Regional Court agreed. Relying on the fundamental principles of freedom to contract and pacta sunt servanda, meaning agreements must be honoured, the presiding magistrate held that the parties’ prenuptial agreement was valid and enforceable. The Applicant subsequently appealed to the High Court.
What did the High Court find?
On appeal, the Applicant advanced two arguments. First, he contended that the prenuptial agreement and ANC consist of ‘materially different terms’ and are thus incapable of being read together. Second, he argued that the prenuptial agreement was not enforceable as it has the effect of ousting the jurisdiction of the courts under section 7(2) of the Act.
Finding in favour of the Applicant, the High Court set aside the Regional Court’s decision. It held that enforcing the agreement would enable the Respondent to claim lifelong maintenance – disguised as a donation – despite the absence of an existing agreement under section 7(1) of the Act, and disempower the divorce court from making a just and equitable maintenance order.
What did the Supreme Court of Appeal find?
Dissatisfied with the High Court ruling, the Respondent appealed to the Supreme Court of Appeal (‘the SCA’). Overturning the High Court’s decision, the SCA concluded that the ANC and prenuptial agreement could ‘co-exist’ as the former regulates the parties’ matrimonial regime during the marriage whereas the latter has no impact on their estates or the nature of the marital regime.
To that end, the SCA held that the prenuptial agreement did not amend or rectify the provisions of the ANC. Instead, it concluded that the Respondent merely sought to enforce a contractual claim for specific performance under the prenuptial agreement.
What did the Constitutional Court find?
The Applicant successfully applied for leave to approach the Constitutional Court on the basis that the matter potentially engaged whether a prenuptial agreement, which purports to govern the patrimonial consequences of divorce, is unenforceable and contrary to prevailing public policy for ousting the courts’ jurisdiction under section 7(2) of the Act. Ultimately, the Court’s decision was split 6-3.
The majority judgment
Writing for the majority, Theron J found that the High Court and SCA erred in assessing the enforceability of the prenuptial agreement in light of section 7 of the Act because the issues were not ‘properly covered by the pleadings.’ Accordingly, Theron J noted that the matter was presented as a ‘stated case’ before the Regional Court in that the parties agreed to determine the enforceability of the prenuptial agreement based on its compatibility with the ANC. Instead, the question as to whether the agreement was enforceable against the backdrop of section 7 of the Act was raised for the first time in the High Court. In this respect, the SCA and High Court omitted to assess the potential prejudice to the parties in adjudicating a new issue on appeal.
Theron J thus averred that the prenuptial agreement constituted an ‘unspecified donation agreement’ on the pleadings, which falls beyond the statutory scope of section 7 of the Act. Ultimately, she concluded that the ANC and prenuptial agreement were compatible instruments given that the donation did not alter the parties’ marital regime while the marriage subsisted. Conversely, its clauses only impacted the value of their estates upon death or divorce. Further, neither the Applicant nor the Respondent intended to amend the provisions of the ANC through the creation of the prenuptial agreement.
For these reasons, the Constitutional Court held that the Regional Court had correctly determined that the prenuptial agreement was valid and enforceable. Notably, the Court ruled that the applicability of section 7 of the Act – as well as considerations of public policy – were open to adjudication by the Regional Court provided the pleadings were amended.
The dissenting opinion
Schippers AJ, in a dissenting opinion, strongly departed from the view of the majority. He argued that the prenuptial agreement constituted a maintenance contract which contravenes section 7 of the Act. Accordingly, it is contrary to the prevailing views of the community and is thus unenforceable. Schippers AJ reasoned that the prenuptial agreement operates to determine spousal maintenance post-divorce, which is incongruent with the requirements of the Act. To that end, he contended that the parties cannot bypass the court’s authority under section 7(1) to review a settlement agreement concerning spousal maintenance, nor its authority under section 7(2) to issue a just and equitable maintenance order when no such agreement exists.
Evaluating the contents of the prenuptial agreement, Schippers AJ argued that the contract, which makes provision for the Respondent’s housing, medical aid, life insurance premiums, transport, and monthly maintenance, reflects the rights and responsibilities of spouses and goes beyond a donation. Emphasising the public policy considerations underscoring spousal maintenance, he reasoned that recognising the prenuptial agreement as a binding donation sidesteps the statutory right to maintenance under section 7 of the Act. Contrastingly, the majority judgment emphasised procedural fairness in determining the enforceability of the prenuptial agreement.
Given the differing approaches of the majority and dissenting judgments, the case underscores the interaction between the public policy principles undergirding section 7 of the Act and the private law principles of the freedom to contract and pacta sunt servanda. Ultimately, the Court’s decision to permit the Regional Court to decide the applicability of section 7 of the Act and assess considerations of public policy if the pleadings are amended, provides an excellent opportunity for further debate and legal development.
